Hi guys, some stuffs from the Schweser Qbank. Assume that on January 1, 2005, a firm with no Global Investment Performance Standards (GIPS) compliant history since its inception four years ago wishes to claim compliance with GIPS. Which of the following accurately reflects the appropriate action for the firm to take? A) Comply with GIPS for the year beginning January 1, 2002, and report its performance prior to this date with a disclosure of why the earlier years are not GIPS compliant. B) Comply with GIPS for the year beginning January 1, 2002, and report only performance results since this date. C) Nothing, a firm must have five years of compliant performance history to claim compliance with GIPS. D) Comply with GIPS for all four periods since the firm’s inception << The correct answer is D>> Why is it so? I thought for firms in existence less than five years, compliant performance since inception must be presented. Only after this initial compliant performance presentation, a minimum required performance of ten more years is added in. Could someone kindly help me along? Thanks.
arty Wrote: ------------------------------------------------------- > Hi guys, some stuffs from the Schweser Qbank. > > Assume that on January 1, 2005, a firm with no > Global Investment Performance Standards (GIPS) > compliant history since its inception four years > ago wishes to claim compliance with GIPS. Which of > the following accurately reflects the appropriate > action for the firm to take? > > A) Comply with GIPS for the year beginning > January 1, 2002, and report its performance prior > to this date with a disclosure of why the earlier "> years are not GIPS compliant. > > B) Comply with GIPS for the year beginning > January 1, 2002, and report only performance > results since this date. > > C) Nothing, a firm must have five years of > compliant performance history to claim compliance > with GIPS. > > D) Comply with GIPS for all four periods since > the firm’s inception > > > << The correct answer is D>> > > Why is it so? I thought for firms in existence > less than five years, compliant performance since > inception must be presented. Only after this > initial compliant performance presentation, a > minimum required performance of ten more years is > added in. > > Could someone kindly help me along? > > Thanks. ----did you read the answer correctly? D) Comply with GIPS for all four periods since the firm’s inception “I thought for firms in existence less than five years, compliant performance since inception must be presented.” Aren’t these the same?..